Chile's three largest banks saw their combined profit improve year over year in the second quarter of 2019, as growth in operating income offset an upturn in expenses.

Banco de Credito e Inversiones SA, Banco Santander Chile and Banco de Chile posted aggregate net income of about 475.69 billion Chilean pesos for the three-month period, rising 14.51% from 415.42 billion pesos in the prior-year quarter, according to data compiled by S&P Global Market Intelligence.

Banco de Chile booked the highest net income among the three banks, advancing 18.19% year over year to 192.13 billion pesos. BCI's and Santander Chile's profits also rose, to 112.34 billion pesos and 171.23 billion pesos, respectively.

The banks' net interest income grew 11.76% annually to reach 1.066 trillion pesos, while net fees and commissions rose 11.30% to 265.97 billion pesos. In turn, operating income advanced 13.01% to about 1.502 trillion pesos.

On the other hand, the combined expenses of the banks increased 12.32% from a year ago, coming to 1.026 trillion pesos. Operating expenses expanded 11.19% yearly to 666.00 billion pesos, while asset write-downs climbed 20.15% to 240.37 billion pesos.

Of the three, only BCI recorded a lower return on average equity, dropping to 12.64% from 13.98% a year earlier. Meanwhile, Santander Chile was the only bank with a lower net interest margin compared to a year ago, sliding to 3.82% from 3.99%.

Banco de Chile saw its core Tier 1 capital ratio fall to 11.02% from 11.16% in the year-ago period, while those of the other two improved.

As of Aug. 5, US$1 was equivalent to 721.55 Chilean pesos.